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Survival strategies: Supply chain management in the aviation industry

You didn't have to look far at this year's MRO Europe to see the numerous announcements aiming to shake up the foundations of supply chain management. But what are some MRO survival strategies for riding these waves of change?

There is more than one area where the MRO industry struggles to keep up with the relentless march of technological progress. In many cases, the ambition of those looking to shake things up doesn't always match the tremendous willpower and resources it will take to reshape some of the more archaic areas of the industry.

This is not to say that progress is not being made. Quite the contrary, in fact. Therefore, we've outlined a few of the more essential survival strategies for navigating the changing MRO landscape.

Understanding predictive maintenance

Predictive aircraft maintenance is arguably one of the most significant game-changers to hit the MRO industry, and the race is well underway for who can develop the most robust solutions. 

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Despite the hype, many questions are still being raised as to how this will affect the smaller MRO providers. The potential loss of work as a result of less unscheduled maintenance events and better life tracking of parts for airlines, is balanced out by the potential for smaller MRO providers to provide more competitive costs and turnaround time. 

While achieving this overall vision of a purely digital MRO sometimes feels stranger than fiction, change is coming—albeit, more as an evolution rather than a revolution. We reported on the view of predictive maintenance and the road to a proactive supply chain after 2018's MRO Europe. Since then, both industry perception and market investment have only grown warmer to prospects of an MRO industry driven by data and analytics.

Like many other industries leveraging the power of data harvesting and analytics, some legal and privacy challenges are arising with airlines and OEMs gathering and processing data from repair facilities and numerous aircraft components. We recently covered some of the issues that could arise with single players owning both the software and the data.

Collecting accurate and comprehensive datasets is going to one of the most valuable assets in the coming years. If smaller MROs can work towards keeping meticulous record-keeping, it could make their business more valuable as larger players in the industry seek to start procuring those datasets for their supply chain solutions.

Investing in skills and training

It would be hard to point out a situation where providing employees with better training and skills could be detrimental to a business. That said, reports are coming out stating that the MRO industry is facing shortages when it comes to new mechanics and staff.

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Despite the somewhat glacial pace in which some areas seem to be progressing, the move from analogue to a primarily digital MRO is coming—and arguably soon, rather than later. This begs the question, how should training and licencing change to account for the more rapid pace of technological advancement.

In an interview with MRO Network, Thom-Arne Norheim, technical director of Norwegian recruiter OSM Aviation explains how a mechanic's required skill set in the coming future is going to be quite different than what we see now. 

Beyond the traditional mechanical prowess, there will be a much greater need for computer and digital skills, as well as extensive training in newer composite materials and techniques for working with them.

On an individual level, MRO providers can be proactive in combining more computer-based, mobile and distance e-learning solutions with on-the-job training to ensure their mechanics are familiar with newer-generation aircraft. On a macro-level, the industry is probably going to have to change the certification requirements for licensed mechanics to reflect the introduction of these new fields of expertise.

Investing in strategic partnerships

As OEMs are beginning to infiltrate the aftermarket with their own proprietary software and data-driven solutions, it begs the question: What can smaller MRO providers do to avoid being squeezed out of the business? 

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Well, the answer could be found in an ancient proverb: "If you can't beat them, join them."

There is no doubt that competition is vital for the health of the aftermarket. It can keep prices down and drive innovation forward. 

Smaller MRO providers will almost always have a disadvantage to larger OEMs that have the power to develop proprietary software and product solutions. On the topic of solutions built on data, we have a situation where MROs can actually have an equal seat at the table. This is because, in order to collect and compile vast data sets, that data needs to come from multiple sources—like the multitude of smaller MRO providers around the globe.

Moving forward, for business to lead in the aftermarket, with efficient and modern supply chain management, strategic partnerships between OEMs and MROs are essential. 

Through these partnerships, the OEMs can build the vast datasets that will power their supply chain solutions, and the MROs can obtain exclusive access to the OEMs software solutions—and specific training that is required to provide maintenance to them.

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About this blog

This blog is driven by Satair Marketing & Communication with input from both internal and external contributors.